Country's third-largest private sector lender Axis Bank today said it has started the process of raising funds through private placement, an exercise estimated to raise over Rs 5,000 crore.
The committee of directors, authorised by the board of directors, took a decision to this effect at its meeting on today, Axis Bank said in a disclosure to the Bombay Stock Exchange.
The bank has already obtained approval from the shareholders through postal ballot for issuing not more than 7.14 crore equity shares by way of Global Depository Receipts/ Qualified Institutional Placement/preferential allotment. The QIP nad GDR opened for subscription today.
The bank is expected to raise over Rs 5,000 crore through these multiple offerings. The preferential issue will allow existing shareholders to maintain their holdings.
Earlier, the bank had said that it plans to make preferential allotment of 1.08 crore shares of total proposed offering to its promoters, including LIC, by September 24.
Post the preferential allotment, the bank could issue up to 6.06 crore shares through GDR or QIP, it had said.
The Specified Undertaking of Unit Trust of India (SUUTI) and Life Insurance Corporation of India (LIC), the principal promoter shareholders of the bank, hold 27.02 per cent and 10.34 per cent, respectively.
SUUTI's stake, however, will dip to 22.54 per cent as it would not participate in the preferential issue. LIC will subscribe to the preferential issue to maintain its current holding of 10.34 per cent.
Under the preferential allotment, LIC would get 73,82,777 fully paid equity shares, General Insurance Corporation of India be issued 15,94,758 and New India Assurance Company would receive 7,55,518 shares.
Similarly, Oriental Insurance Company, United India Insurance Company and National Insurance Company would get 3,05,084, 2,58,234 and 5,29,702 equity shares respectively under the preferential allotment.
In mid-2007, Axis Bank, then UTI Bank, had raised over $1 billion (Rs 4,750 crore as per present value) through a combination of GDR, preferential share issue and qualified institutional placement.
